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If the person who has just sold at 79 is reading this BB, could you please, please just let me know your thought process and what you are thinking? Just beyond curious as to what people's thought processes are.
A £1 offer is on the table, Gold is up $30oz on the day and at 6 year highs, while this share is barely scraped above all time lows and is currently in line to be sold at a level half that of when the Youga mine was acquired.
More mammoth buying (3.11pm), another £870k gobbled up. So nearly 3% of the company changing hands today - share price unbudged, and little wonder these are being eaten up as the company is STILL 20% below the £1 offer price. Only on AIM.
was that 900k a buy or sell?
Stock Prices Can Change Even After A Merger Is Announced
A common question relative to M&A activity and its affect on stock prices is why the acquisition target’s stock price does not equal the value the acquirer will be paying. In other words – if company A is buying Company B’s stock for $10 a share in a few months, why doesn’t Company B’s stock equal $10 immediately following the announcement?
Uncertainty Can Lower Prices
The differential between an M&A target’s acquisition price per share and its current trading price accounts for the uncertainty around the merger. If the purchase never actually happens, the target’s stock will likely drop significantly. In the video, I will cover another case study of a stock that was going through a deal of its own at the time of recording.
Hostile Takeovers Are Even More Uncertain
The more uncertain the actual merger is, the wider this delta or differential will be. For example, if the target company is being subjected to a hostile or unsolicited takeover the difference between the acquisition stock price and the current stock price will be very wide as management works to fend off the acquirer or attract a “white knight” to rescue it from the larger firm.
Sometimes the Acquisition Target’s Stock Will Rise Above the Takeover Offer
This can happen when traders believe that there is likely to be another bidder that will offer more for the firm. This is a more unusual situation but it will happen from time to time when the deal would give the winning bidder a significant competitive advantage.
Think Before Trading
It may be tempting to take advantage of the differential by buying the target’s stock and shorting the proper ratio of the acquirer’s stock. That strategy has a very poor risk/reward ratio as the downside can be many times the possible upside. Long Term Capital Management (the trillion dollar hedge fund bailed out by the Fed in the late 1990’s) famously built a problematic portfolio of highly-leveraged versions of this trade.
Link to Article:
<https://www.learningmarkets.com/how-mergers-and-acquisitions-affect-stock-prices/>
Nope.
Does anyone understand why this is trading at a 20% discount to the INITIAL takeover price?
The price won't get any lower than £1 and could easily be pushed higher.. what are people who are selling in the low 80s / not buying for the easy 20% upside at a minimum thinking? Genuinely curious.
Do they not think the billionaire owner will be able to to pull together the funds?
Do they not think the family that has run this down from £2, £3 a share to buy out the lot at £1, won't snap shareholders hands off at that price?
Legitimately baffled at the size of this discount.
Highlandmatt. I originally lost 5 figures under the AUREUS banner and as I a have fully invested my share cash elsewhere I am reluctant to investor more than the 3K I ha e in ASO. here even with the prospect of SP improvement from here. As far as YOUGA goes he originally bought it cheap as an "END OF MINE LIFE" proposition. No doubt as a way into the Gold mining business. The virtual take over of AUREUS (now called ASO) was to ensure a transition into a mining company that had reserves (the Liberty mine). For the past 2 years I have often wondered when/if he would launch a takeover bid, now that he has I still think it is the Major holders who will establish the final price. It all depends on how much of a loss they are happy to swallow, but I shall be holding for somewhere north of £1.20. Ad always DYOR
Cheers for that. Gold appears to be holding above 1500, which is nice, but if we have costs of $250m per annum, we need to produce 166kt to break even. If the grades in the orebody are up the spout, and we need Capex of 10s of millions to take New Liberty underground, what do we think is the likelihood of achieving that? Bizarrely, the related party transactions might just be a benefit at the moment. He needs the company to keep going to get paid.
One thing that is puzzling me, is that he effectively loaned money to Avesoro to buy Youga off his holding company (i.e. paying himself), but then wants to buy it back with his holding company. I initially thought it was a way to extract a value for Youga that he could pocket (i.e. Avesoro is expendable and Avesoro Jersey was where the profits went), but now he seems to want Avesoro inside Avesoro Jersey. My conclusion is he now needs the dollars that the mining operation brings, and is now just being opportunistic to snaffle the rest of the company on the cheap while it has some temporary issues.
Anyone else think this should drift up to £1 (at least) from here?
Highlandmatt. He has 3 months to get to a squeeze out position or else the bid has to be abandoned. So tracking back a year from mid Nov 2019 the highest price would be £1.7 ish (if he bought any at that price). And don't forget that the majors have paid in excess of £3 so to get thier support I would expect somewhere between £1.20 and £3. That's a wide spread I know but as I am not a fly on the wall its the best guess I can offer at the mo
I'm very sceptical of the benefits of using trend analysis for any shares where there are either major changes in the economic environment it operates (e.g. market product prices) and/or company circumstances (discoveries, licence changes). Can anyone enlighten me to the theoretical benefits of using past share price for anything other than a very stable share?
Sorry didn't understand either of those links you posted
Well I think Ive just about had enough of AIM shares now after this. I just lost a load with another dodgy lot of faquars Angus energy. If I went back further I could make a list. Of Co's. One day I hope there will be investigations and prosecutions into these Companies. Similar to what we have now with the PPI scandal and then the mortgage endowment and indemnity mis selling. What happened to the goal of Mid tier gold producer ? Its all pie in the sky. They've taken us hook line and sinker with this and even done a consolidation so that they could devalue even further. What a shower and yes think I wouldn't put it past them to pay for the recent trouble they've had. Come and break in when we're not there and cause a bit of damage. Give us an excuse to shut the mine now gold is going up we can shaft every ****.
At least I know that this crook that has ripped of all private investors in this gold mine won't be able to spend the £1000 I have lost. Never find it in his billions. How much more money do these selfish Pricks need.
That would be £2 at the moment, then?
However, steadily dropped to £1 in the 9 months to May this year. So, if he took his time, better for him?
Aplogies for the inaccuracy in my previous post "
Once he has the 90% "squeeze out" holding the squeeze out price can be no lower than the lowest purchase price paid in the previous 12 months to any MM, PI or Major Shareholder." is INCORRECT
I should have written "Once he has the 90% "squeeze out" holding the squeeze out price can be no lower than the HIGHEST purchase price paid by the TO Bidder in the previous 12 months to any MM, PI or Major Shareholder."
T'was a Freudian slip when I wrote "no lower than the lowest purchase"
Well bitterly disappointed by this RNS.
However, this is only an offer, you do not have to accept it at this Stage.
Please note to force an acceptance of a take over my understanding is that he requires a 90% holding as per current EU, LSE/Jersey rules - though I am not certain about the TSX squeeze out percentage the Canadian, and indeed most other Exchanges, are very broadly similar.
According to the AVESORO website your man has approx 72% of the Shares in issue with 19% held by three Major Shareholders and the remainder with us poor souls.
Once he has the 90% "squeeze out" holding the squeeze out price can be no lower than the lowest purchase price paid in the previous 12 months to any MM, PI or Major Shareholder. To achieve the 90% therefore he has to buy some from a Major shareholder and somehow I don't think they will accept £1 before or after the squeeze out.
It is therefore my belief that £1 is but an opening Gambit.
All,
I've tried catching up on the posts over the last few days to see exactly what's happened here.. Sorry for the lack of common sense.. But I came here looking at this share as a daily riser.. And now everyone's saying the end is nigh and PIs are shafted? What's the basic storyline here?
well folks,looks like the end has finally come.been in here since it was aureus and at the offer of £1 per share sitting on a huge loss, like a lot of others on here im sure.mr mng has finally done what some of us predicted.manipulate the sp then buy pi sh areholders out for a fraction of it's future value.greedy turkish b@ast@rd.
Investors are reminded that the Company is not subject to the UK City Code on Takeovers and Mergers......................................
which means its all done under Canadian takeover rules.
What an outcome.
Not sure what is worse - the token £1 having clearly been manipulated into making this look like its a good deal for shareholders (it isn't). Or the fact, that in spite of the £1 offer, I can't even ditch my position and move on above 80p! So I can't even get the actual value its going to go for. You couldn't make it up.
Not that anyone needs reminding as Mr MNG has not pulled the wool over any PIs eyes judging by the (deserved) response on this board, but this was trading way above £2 before the Youga mine was even acquired. And rest assured, once this goes out of private investors hands for a complete song, all the issues will be magically resolved and they will be mining all this ore at a far, far higher $/oz of gold. What's more - there is completely nothing we can do about it. AIM again at its utter worst. And even where directors have vast skin in the game (the holy grail on AIM), PIs still manage to get shafted. This leaves a really bitter taste.
This vehicle for lining the pockets of Mr MNG has reached the end of the road. As I was saying in my previous posts the aim was to extract as much profit as possible out of the company through related party transactions and saddling it with debt. Now through a suspect crisis there was another engineered fall and the time to strike has come. AIM and especially miners is a fools errand. These s$isters have seen an opportunity to royaly s$rew PIs and they've taken it.
The statement below is basically saying that the so called special and independent committee all lackies of Mr MNG are going to provide a veil of legitimacy to the process of fleecing PIs. Just to enforce the message, in case anyone was thinking about complaining, there is a reminder that the UK's City code on. Takeovers and Mergers does not apply here. Just in case you thought of screaming murder here.
"The board of directors of the Company has established a special committee (the "Special Committee") comprised of all of the independent directors of the Company. The Special Committee has a mandate to conduct a detailed review and analysis of the Acquisition Proposal and to identify and consider alternatives that may be available to the Company, with a view to determining whether it is in the best interests of the Company to support the Acquisition Proposal and the transaction contemplated therein. The Special Committee has engaged independent legal counsel and is in the process of engaging independent financial advisors to assist with its review. In particular, the Special Committee plans to obtain an independent valuation that will be required under Canadian Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Investors are reminded that the Company is not subject to the UK City Code on Takeovers and Mergers."
Still cheap though surely, based off owners purchase and POG
They do. Present value should the value of future flows, but of course this is AIM, the ultimate hot bed of price inefficiency. The shrewd will be buying now, not far off all time lows and await the Company to formally confirm what the markets are telling us, to realise value. There will be others, who won't buy because of their "concerns". Those concerns are:
- Funding shortfall. The shortfall had been reduced to the size of the MNG loan at $1,400 gold. We are now $1,500+ and MNG will not distress his own company (that he holds 70% of - unheard of "skin in the game" by AIM standards), so the loan would surely be extended.
- Production reduced due to disruptions. Again, lower guidance communicated already and the SP has been battered for that. 52 week highs around £3, versus 70p to buy this afternoon. Any production shortfalls should be offset by the cost cutting measures employed during H1, and the increased revenue per oz arising from the rampant price of gold. (20% up in the last 2.5 months!)
Biggest bargain on AIM in my view. And I await the rerate safe in the knowledge the owners hold over 70% and took their holdings on at 3x today's prices.
Up over 10% today on no news, wonder if tomorrow there will be a RNS saying the mines are open again. I wish I had topped up yesterday while they were 60p. ASO must be the most undervalued gold miner out there. Although all gold miners need a rerate with the price of gold what it is now. Thought share prices responded to future profits but wtfdIk !
Hgm doing well, PAF hopefully recovering well. GLA